Are you protected? Do you need to be?
Credit: Jürgen Fälchle/Fotolia
Psst. Very few Americans – just 1 in 5 according to CNN – know about the newly established Bureau of Consumer Protection. Boring name, I know, but it aims to protect consumers and as a savvy spender you should know how it can help you.
The BCP covers seven areas, including advertising practices, consumer and business education, enforcement, financial practices, marketing practices, planning and information, and privacy and identity protection. Its website says:
The Bureau of Consumer Protection works to protect consumers against unfair, deceptive, or fraudulent practices in the marketplace. The Bureau conducts investigations, sues companies and people who violate the law, develops rules to protect consumers, and educates consumers and businesses about their rights and responsibilities. The Bureau also collects complaints about consumer fraud and identity theft and makes them available to law enforcement agencies across the country.
Scams are also a focus of the BCP, which has a page on weeding out free trials that aren’t free. Another page has a video on scams targeting people looking for a job. Some of them are, sadly, quite savvy. To submit a complaint about unfair business practices or a scam, visit ftc.gov/complaint.
Depending on your politics, the new agency has pros (consumer protection and education) or cons (more restrictions on financial products and more government oversight). I’m hopeful that the BCP will, in fact, protect and educate consumers about predatory lending and other ridiculous business practices that got us into the mortgage crisis, while not letting consumers off the hook (greed and irresponsibility played a huge role, too).
Do you think the Bureau of Consumer Protection will make a difference?
Welcome to Bargain Babe! I’m Mara, and I’m so glad you’re here. I am an obsessive bargain hunter and penny pincher, and I am determined to live a full life without EVER paying full price.
I’d feel more confident about this bureau being able to do a good job if President Obama had pushed harder to retain Elizabeth Warren, the woman who, up to this point, has been leading the charge to clean up all the financial misdealings of big business and government, and has earned respect and approval from many in Washington.
I sure hope so. Consumers aren’t organized like business with its Chamber of Commerce and lobbyist in DC
Isn’t this what the Better Business bureau is for? Why spend more money, add more red tape & start another program that we can[‘t afford?
@Jen I wish! The Better Business Bureau represents many businesses, but the catch is that a business must pay to be included. I know because I got a sales call and it was something like $600 a year to join! Because the BBB is funded by businesses, it does not have consumers as its first priority, but instead exists to protect the reputation of its members.
@Jen and BB ~ The Better Business Bureau, like the Chambers of Commerce, are self-serving, and their main focus is on local businesses. The Consumer Protection Bureau is a federal agency set up to oversee all aspects of business, including the shenanigans of Wall Street and all the obscene perks big business CEOs award themselves and their cronies, as well as to monitor how banks treat home loans, etc. If you, or anyone you know, has been the victim of fraudulent efforts to foreclose on a home, you know how much this type of investigatory agency is needed. These crooks have never, and will never, monitor themselves, and the loopholes protecting them are too varied and often too miniscule to be seen or known by most of us.
And a government agency staffed by career bureaucrats is not self-serving? This is yet another layer of government that will burden everyone with more regulations that will do nothing to help consumers. Government programs always cost more and produce less than promised, and they have unintended consequences that cause greater problems than the ones they were created to solve. Why is it that no matter how badly government performs, we always look to it to solve our problems?
Every dollar the government spends is money taken out of the productive economy. And, in case you haven’t noticed, the US is in debt up to its collective eyeballs. We are spending ourselves into bankruptcy, and another government agency is just adds to our debt.
@Aggie Interesting point. On the other hand, if we had had better regulation of financial securities and mortgages, would we have avoided the mortgage crisis and ensuing recession?
I agree with some of Aggie’s comments as well, as more government bureaucracy is rarely effective. When George Bush appointed Christopher Cox (a termed-out Congressman from Orange County, CA) to oversee the SEC and bring about reform and better oversight, things only got worse. Again, a case of the fox watching the hen house. Elizabeth Warren is not a career politician (nor even a politician at all, to my knowledge), whose background in consumer issues and safeguards is recognized by people on both sides of the political spectrum. I’m not so sure the same can be said about President Obama’s current nominee, who is definitely a politician.
BB, there are plenty of laws and regulations on the books. In fact, hundreds if not thousands, are added daily. Just for fun google “what laws have I broken” and you will find there are so many laws that most folks break at least a few without even knowing it.
The financial mess and mortgage crisis were caused by government policies. Policiticans decided that all Americans should have a shot at being homeowners. Well-intentioned, perhaps. As politicians pressured banks, and particularly Fannie and Freddie, to offer loans to people who could not afford them and in high-risk regions of cities, it was bound to fail.
These sub-prime loans received the blessings of the 3 ratings agencies, so that other financial institutions thought it was OK to purchase these bundled loans. No competing agencies are allowed to enter the market. Strike two on government.
Finally, there was the increase in the money supply and subsequent lowering of the interest rates by the Fed from 2000 to 2004, that encouraged reckless borrowing. At times, interest rates were lower than the inflation rate. At other times the cost of borrowing seemed to be lower than the expected increase in the value of the property. This was, of course, a fantasy.
The bubble had to burst. When inflation kicked in from the easy money the Fed was creating, the Fed was forced to raise interest rates in 2006. That is when the house of cards started to collapse.
By the way, the CEOs of Freddie and Fannie made about $30 million in 2007, so we can see who really profits from government programs.
More regulations will do nothing to stop the kind of crooked dealings that go on between politicians and their friends in big business. In fact, increased government regulation is a far greater burden on small businesses, because they do not have funds nor the ability to deal with all of it.
As for Ms. Warren, she is an idealogue who believes she is smart enough to substitute her judgment and decrees for the choices of millions of individuals and businesses who ought to be left to trade freely with one another. We already have plenty of laws on the books that allow people redress in the courts if they believe they are harmed.
The best protection for consumers is knowledge, and sites such as BB on the internet. Nobody watches your money as carefully as you do yourself.